L.A. Area Chamber

    TUESDAY | March 24, 2009




Coming up
at the Chamber

View all upcoming events on our Web calendar.

WED | March 25
Member Orientation
more info

FRI | March 27
Building a Green Community: A Conversation About Community Energy Planning
more info

MON | March 30
V.I.P. Reception for Roger Snoble
Open to Board, Circle Level Members and Mobility 21
more info

THU | April 2
Transportation & Goods Movement Committee Meeting
more info

The Los Angeles Area Chamber of Commerce is the voice of business in L.A. County. Founded in 1888, the Chamber promotes a prosperous economy and quality of life in the Los Angeles region. For more information, visit

350 S. Bixel St.
Los Angeles, CA 90017
213.580.7500 tel
213.580.7511 fax



Businesses in California have yet another reason to look carefully over their shoulders. In the middle of this very difficult economy, a state advisory board has recommended a nearly 25 percent hike in workers' compensation rates. The recommendation underscores the precarious survival of the 2004 workers compensation reforms passed by the Legislature and signed by the governor.

Remember 2003? Workers’ compensation costs had jumped to $21.8 billion from $6.8 billion in 1997. Businesses faced double and triple-digit annual rate increases that crippled many companies and gave California a terrible rap for having the highest workers' compensation rates and one of the worse business climates in the nation. Fortunately, the governor and state Legislature acted to fix the broken system.

California businesses have saved about $40 billion since 2004 because of these reforms, which reined in costs and reduced litigation. Workers' compensation rates dropped by 60 percent and the state moved from 1st to 14th in terms of overall costs to employers. It was the most important business reform in California in decades and kept thousands of jobs in the state.

The California Workers' Compensation Insurance Rating Bureau’s recent recommendation to raise rates by nearly 25 percent could not come at a worse time for businesses and our economy. At a time when nearly every business is facing declining revenue, rising costs for workers' compensation insurance will make it more challenging for employers to retain their talented staff.

It is clear that part of the lasting solution for the rising cost of workers' compensation insurance lies with health care reform that takes costs out of the system. As the federal government is addressing this issue, California must make every effort to keep from sliding back into the workers' compensation money pit that will stifle our job creation and economic recovery.

The good news is that State Insurance Commissioner Steve Poizner has tempered previous attempts to raise rates. This time he has pledged to carefully evaluate every aspect of this recommendation and make a decision that's in the best interest of the state's employers and employees.

These are extraordinary times that demand both bold action and careful treading – but mixing up the two can be disastrous. We hope that Insurance Commissioner Poizner and state elected officials opt for careful treading on workers' compensation rate increases and bold action on health care reform.

And that's The Business Perspective.

Gary L. Toebben
President & CEO
Los Angeles Area Chamber of Commerce

The Business Perspective is a weekly opinion piece by Gary Toebben, President & CEO of the Los Angeles Area Chamber of Commerce, produced with the input of Samuel Garrison, Vice President of Public Policy.
by Gary Toebben, President & CEO, Los Angeles Area Chamber of Commerce


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Los Angeles Area Chamber of Commerce, 350 S. Bixel St., Los Angeles, CA 90017
213.580.7500 | fax: 213.580.7511 | info@lachamber.com | www.lachamber.com

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